Selling Infrastructure--the Challenge of Linux in Business

As Linux makes greater strides in business with the ``big boys'', new questions arise for both established Linux companies and recent arrivals...about how far to carry the open source ideology.

We're in an ideal time to start selling
Linux ``solutions'' to enterprises. The big-time IT department
allergy to the world's least businesslike operating system has
started to wear off, mostly because, as always, the engineers are
having their way. They're putting Linux to use all over the place.
In most cases, management has little choice but to acquiesce to the
obvious or ratify it by declaring Linux ``strategic''.

IBM's decision to adopt Linux enthusiastically is nothing
less than huge. While Big Blue may not carry the clout it once did,
there still isn't a more significant company in the business. But
let's face it: selling Linux to business hardly requires a sex
change for IBM. They're a hardware and services company; Linux
makes it easier to develop and sell both.

It is a little different for companies native to the
GNU/Linux community, which grew out of the free software and Open
Source movements. While it would be wrong to call either movement
``anticommercial'', it would be fair to say that suiting up Linux
for business is not their central concern.

However, bringing Linux to business has always been the
central concern of Caldera, Red Hat, VA Linux and other Linux
community natives. It's also a concern of new companies like Eazel,
Zelerate and Ximian, as well as of newly arrived computer industry
veterans like Borland, HP, Dell and Sun. The difference, again, is
in respect for what the Linux community brings to business, whether
either side likes it or not.

In every case, what the community brings is infrastructure.
Linux is now a basic building material for business. So are
open-source applications like PHP, Squid, Jabber and MySQL, plus
open protocols like SOAP, XML and SLP.

There are several fundamental questions facing every company
using (or, to use business lingo, ``leveraging'') these
infrastructural goods:

What do we contribute to the code base of the free
and open infrastructure we use?

What do we charge for?

What do we give away?

What code do we keep closed?

It's a given that the native Linux companies are going to
want to contribute as much as possible to common code bases.
Caldera, for example, is contributing its work on the SLP protocol
to the community through OpenSLP.org. Popularizing SLP and inviting
more development of the protocol can only help drive sales of
Volution, the new Caldera management product that depends on the
protocol. It will also help make a market for competing products,
which will also raise sales of Volution. Borland is following a
similar strategy by open-sourcing CLX, the cross-platform libraries
for Kylix, the company's new IDE (integrated development
environment).

What's a surprise these days is how many non-Linux (and even
nonsoftware) companies are starting to give away infrastructural
code. Several months ago the Dresdner Bank of Germany gave away the
code to a product called OpenAdaptor, which cost the bank an
estimated $5 million to develop. They believe the code will do more
good for everybody--including Dresdner, which has ``first mover''
advantage--if it's out there in the open world. The lesson here is
that businesses are learning how to join the traditional hacker
community as contributors to common infrastructure. The more this
happens, the more the whole business community begins to understand
that what is best for all of us is also what is best for each of
us.

So let's go back to native Linux companies like Caldera and
Red Hat. These guys are quietly living with the problem of how to
answer question number four: what code do we keep closed? Caldera's
Volution is a closed-source product. Caldera says Volution is
``built on open standards'', but that's a buzzphrase saying one
thing while avoiding another. The quiet fact is the source code to
Volution is closed. Could Caldera sell it for the same price if it
were open? We don't know. Nobody seems to want to test the theory
that high-ticket software can also be open source. Red Hat is
following a similar strategy with Red Hat Network Services, which
quietly deploys Novell's NDS as its ``next generation network-based
storage system''. This is no doubt part of the Novell-Red Hat
``alliance'' that Novell has been eager to celebrate pretty much
alone (judging from the comparative sizes of the two companies'
stacks of press releases on the matter).

Let's be fair here: this is a touchy area. Open-source
vendors don't want to risk annoying their development communities.
They're moving carefully not only into new product spaces, but into
new diplomatic territories as well (unless, like Zelerate, Ximian
and Eazel, their primary business models are to give away
open-source software and sell services).

This conflict will pass as more companies discover the
economic paybacks of generous responses to question number one.
Until then, each company will test that question in its own way.
IBM has eagerly promised to contribute all it can to the
development of Linux and the support of its surrounding Open Source
communities. Meanwhile, Michael Dell has expressed a more
conservative position, but one no less carefully considered. Here
is what he said during the question-and-answer session after his
keynote at the LinuxWorld Expo in August 2000:

Are we going to contribute to the kernel? No,
we're not. We're going to use Linux, we are going to provide Linux.
As a product becomes established, high volumes require a different
kind of company. We have a global support structure. We are
spending more R&D dollars, in percentage, on Linux than any
other platform.

So there it is. Linux matters--a lot. In fact, it matters so
much that it deserves the description that Sun CEO Scott McNealy
once gave to the Net: ``insurmountable opportunity''.

Doc
Searls is senior editor of Linux Journal and a coauthor
of The Cluetrain Manifesto.

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